Saturday, March 29, 2014

Cuba's Economic Plan

The Cuban government made a leap for more foreign economic success Saturday, by creating a few new laws to make themselves more attractive to other countries. Cuban lawmakers decided to amend their almost twenty year old plan from 1995 to boost their economic standings. Vice President Mariano Murillo, the czar of President Raul Castro's economic reforms, told his country and the world that "Cuba needs from $2 billion to $2.5 a year in direct foreign investment to advance its socialist socioeconomic model, prosperous and sustainable."

The new law outlined certain amenities for those who choose Cuba for their foreign trading. This includes cutting tax on profit by 15 percent and making countries exempt from paying taxes for the first eight years of operation. In addition, many foreigners in Cuba doing business will not have to pay personal income tax. Companies who exploit natural resources will have to pay as much as 50 percent on profit tax to show Cuba's commitment to saving the environment.

Cuban leaders are hopeful that this new law will lure more over seas capital than the previous investment law. The big problem for the Cuban economy is that is not advancing like a developing nation should. Last year, Cuba's gross domestic product was weak with only a 2.7 percent expansion. Government leaders stressed that the economy needs to expand 5 to 7 percent each year to develop the way they plan to.

Despite this new economic reform, along with many others President Raul Castro has implemented since receiving the presidency from his brother Fidel Castro in 2008, it isn't enough without the backing and capital brought in by the United States. Both Raul Castro and Obama have made steps to soften the harsh relationship between the countries dating back to the 1950's, but the tension is still pretty thick. Many economic sanctions are still in place, along with Cuba being named a state sponsor of terrorism. Cuban government even went so far to as to say that the economic restrictions from U.S companies over the past fifty years have resulted in a loss of over $1.126 trillion.

Cuba and the United States need to soften their relationships to help Cuba improve their economic standing. And the only way to do so is by freeing U.S citizen Alan Gross whom has been imprisoned since 2009 for allegedly trying to destabilize the Cuban regime.